• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

Congratulations to Jamil from Pakistan and Jeeva from Malaysia - Global Prize winners!
see all ACCA December 2022 Genius Hunt Competition winners >>

Specially for OpenTuition students: 20% off BPP Books for ACCA & CIMA exams – Get your BPP Discount Code >>

Relevant costing

Forums › FIA Forums › MA2 Managing Costs and Finance Forums › Relevant costing

  • This topic has 1 reply, 2 voices, and was last updated 1 year ago by Ken Garrett.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • August 18, 2021 at 3:55 pm #631973
    James124
    Participant
    • Topics: 159
    • Replies: 136
    • ☆☆☆

    A company is launching a new product. In order to manufacture this new product, two types of labour are required skilled and semi-skilled. The new producti requires five hours of skilled labour and five hours of semi-skilled labour.

    A skilled employee is currently paid $10 per hour. Should he/she work on the new product a replacement would have to be obtained at a rate of $9 per hour, for the work which would otherwise be done by the skilled employee. The current rate for semi-skilled workers is $5 per hour and an additional employee would be appointed for this work.
    What is the relevant cost of labour to be used in making one unit of the new product?
    Author is not taking contribution lost for skill labor. He is adding only the cost of labor hired skill and unskilled labor. Which give him total of 70.

    August 18, 2021 at 4:32 pm #631977
    Ken Garrett
    Keymaster
    • Topics: 10
    • Replies: 10194
    • ☆☆☆☆☆

    You can reliable find a relevant cost by thinking how a decision has changes cash flows.

    Existing work is still carried on. The only changes to cash flows are the extra 5 hours paid at 9 and an additional 5 at 5.

    If existing work had been given up, lost contribution would be relevant.

  • Author
    Posts
Viewing 2 posts - 1 through 2 (of 2 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

ACCA News:

 

ACCA My Exam Performance for non-variant Applied Skills exams is available NOW

NEW! Download the ACCA Pass Guide

FREE Verifiable CPD for ACCA Members

ACCA mock exams and debrief videos

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

Donate

If you have benefited from OpenTuition please donate.

ACCA CBE 2023 Exams

Instant Poll * How was your exam, and what was the result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Specially for OpenTuition students

20% off BPP Books

Get BPP Discount Code

Latest comments

  • MelodyC on MA Chapter 10 Questions The Management Accountant’s Profit Statement – Marginal Costing
  • douglasnyangara on Foreign exchange risk management (1) Part 4 – ACCA (AFM) lectures
  • douglasnyangara on Foreign exchange risk management (1) Part 4 – ACCA (AFM) lectures
  • AnnaTeddy on Basic group structures – SPLOCI introduction and example – ACCA (SBR) lectures
  • tanyanti on Conceptual Framework – ACCA SBR lecture

Copyright © 2023 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in


We use cookies to show you relevant advertising, find out more: Privacy Policy · Cookie Policy